Midday Market Report: Nifty dips below 22,550 as bank, IT stocks drag; smallcap index outperforms

Indian equity markets remained volatile on March 7, with the Nifty 50 slipping below the 22,550 mark as banking, IT, and FMCG stocks came under pressure. However, the broader market displayed resilience, with the smallcap index outperforming, gaining up to 1 per cent in intraday trade.

Banking and IT stocks weigh on sentiment

Weakness in heavyweight banking and IT stocks dragged down the benchmark indices. IndusInd Bank, Infosys, NTPC, and Shriram Finance were among the top losers. On the other hand, Bajaj Twins, Axis Bank, Grasim Industries, and Eicher Motors led the gainers list, providing some support to the indices.

By 12:15 PM, the Sensex was down 67.31 points or 0.09 per cent at 74,272.78, while the Nifty declined 11.80 points or 0.05 per cent to 22,532.90.

Global uncertainties and foreign fund outflows add pressure

Market sentiment remained cautious amid continued foreign fund outflows and concerns over global trade policies. US President Donald Trump’s decision to delay imposing tariffs on Canada and Mexico until April 2 raised fears of prolonged trade negotiations, further adding to investor uncertainty.

The US markets witnessed sharp declines on Thursday, with the Dow Jones Industrial Average falling 406 points, or nearly 1 per cent. The S&P 500 and Nasdaq Composite also dropped 1.3 per cent and 1.8 per cent, respectively. New tariff measures on imports from Canada, Mexico, and China, which took effect this week, rattled global investor sentiment. Canada and China imposed counter-duties in response, while Mexico hinted at announcing its own measures soon.

Technical outlook: Key levels to watch

Anand James, Chief Market Strategist at Geojit Financial Services, highlighted key technical levels for traders. “While we recently raised our upside target to 23,000, we had anticipated resistance around 22,513. A break below 22,360-22,322 could force a reassessment of the bullish outlook, though the likelihood remains low,” he said.

With markets remaining choppy and global uncertainties persisting, investors are likely to tread cautiously, focusing on key domestic and international developments before making fresh positions.